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based on these examples and “other market oriented research
completed by this appraiser” (not otherwise described by Parks),
the appropriate discount rate is 18 percent.
We are unpersuaded that the “examples” on which Parks bases
his comparable sales analysis actually represent comparable
sales. Even if they did, we find no adequate justification for
his selection of an 18-percent discount rate–-a rate that is well
below the smallest discount indicated by Parks’ own
“comparables”. Consequently, we do not rely on Parks’ report.
See Rule 143(f)(1).
We are unsatisfied that any of the parties’ experts have
adequately justified their recommended discount rates–-a
shortcoming that might be attributable in part to a lack of
available empirical data. Given that the parties agree that some
valuation discount is appropriate, however, and lacking any firm
basis on which we might independently derive one, we accept
Lawton’s recommended 30-percent valuation discount as being the
most reasonably justified of the opinions presented to us. This
is the same discount rate that petitioner used in reporting the
value of the undivided interests for Federal estate tax purposes.
Accordingly, all valuation issues in dispute having been
determined in petitioner’s favor, we conclude that petitioner
correctly reported the fair market value of the QTIP trust’s
undivided interests in the subject property as $519,000.
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